Some Economists Argue That the Fed Should Commit to Keeping $\vec{ M }$

question 113

Multiple Choice

Some economists argue that the Fed should commit to keeping $\vec{ M }$ + $\vec { v }$ fixed at a particular value,say 5%.How would this rule require the Fed to respond in the event of a negative spending shock? A negative real shock?

• A) increase
• \(\vec{ M }\) ;do nothing
• B) increase
• \(\vec { M }\) ;increase
• \(\vec{ M }\)
• C) increase
• \(\vec{ M }\) ;decrease
• \(\vec{ M }\)
• D) decrease
• \(\vec{ M }\) ;increase
• \(\vec{ M }\)

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Definitions:

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Fundamental components or elements that make up a larger system, concept, or structure.

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A research paradigm in which different experimental participants participate in different experimental conditions.

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